<PAGE>
As filed with the Securities and Exchange Commission on May 17, 1995
Registration No.
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------
FORM S-8
REGISTRATION STATEMENT
UNDER THE
SECURITIES ACT OF 1933
----------------------
APPLIED MAGNETICS CORPORATION
(Exact name of Registrant as specified in its charter)
DELAWARE 95-1950506
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
75 Robin Hill Road
Goleta, California 93117-3108
(Address of Registrant's principal executive offices)
APPLIED MAGNETICS CORPORATION
1994 EMPLOYEE STOCK OPTION PLAN
RAYMOND P. LE BLANC, ESQ.
Vice President, Secretary and General Counsel
Applied Magnetics Corporation
75 Robin Hill Road
Goleta, California 93117-3108
(Name and address of agent for service)
(805) 683-5353
(Telephone number, including area code, of agent for service)
-----------------
With a Copy to:
STEPHEN E. NEWTON, ESQ.
Kindel & Anderson
555 South Flower Street
Twenty-Ninth Floor
Los Angeles, California 90071
(213) 680-2222
----------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
_____________________________________________________________________________________________________________
_____________________________________________________________________________________________________________
Proposed Proposed
Maximum Maximum Amount of
Title of Securities Amount to be Offering Price Aggregate Registration
to be Registered Registered Per Share Offering Price Fee
_____________________________________________________________________________________________________________
<S> <C> <C> <C> <C>
COMMON STOCK 1,000,000 SHARES $3.94(1) $3,940,000 $1,359
_____________________________________________________________________________________________________________
_____________________________________________________________________________________________________________
</TABLE>
(1) Estimated solely for purposes of determining the registration fee based
upon the average of the high and low prices of the Common Stock on the New
York Stock Exchange on May 10, 1995.
================================================================================
<PAGE>
PART II
INFORMATION NOT REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
- ------ ---------------------------------------
All documents filed by Registrant pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Securities Exchange Act of 1934 (the "Exchange Act") subsequent to
the date of the filing of this Registration Statement and prior to the filing of
a post-effective amendment to the Registration Statement which indicates that
all securities registered under this Registration Statement have been sold or
which deregisters all securities then remaining unsold shall be deemed to be
incorporated by reference into the Registration Statement.
The following documents filed with the Commission (File No. 1-6635)
pursuant to the Exchange Act are incorporated in this Registration Statement by
reference:
1. Registrant's Annual Report on Form 10-K for the fiscal year ended
September 30, 1994.
2. Registrant's Quarterly Report on Form 10-Q for the three months ended
December 31, 1994.
3. Registrant's Quarterly Report on Form 10-Q for the three months ended
March 31, 1995.
There is incorporated in this Registration Statement by reference the
description of Registrant's Common Stock contained in Registrant's registration
statement filed with the Securities and Exchange Commission under Section 12 of
the Securities Exchange Act of 1934, together with any amendment or report filed
with the Securities and Exchange Commission for the purpose of updating such
description.
Item 4. Description of Securities.
- ------ -------------------------
Not applicable.
Item 5. Interests of Named Experts and Counsel.
- ------ --------------------------------------
As of April 30, 1995, Raymond P. Le Blanc, Vice President, Secretary and
General Counsel to Registrant, owned 23,133 shares of Registrant's Common Stock
and held options to purchase 73,817 additional shares.
Item 6. Indemnification of Directors and Officers
- ------ -----------------------------------------
Section 145 of the Delaware General Corporation Law permits
indemnification of directors, officers and agents in terms sufficiently broad to
permit such indemnification under certain circumstances for liabilities
(including reimbursement for expenses incurred) arising under the Securities Act
of 1933, as amended. Article Seventh of the Bylaws requires indemnification to
the full extent authorized by the General Corporation Law of Delaware.
Registrant also maintains insurance policies which insure its officers and
directors against certain liabilities.
Item 7. Exemption from Registration Claimed.
- ------ -----------------------------------
Not applicable.
Item 8. Exhibits.
- ------ --------
4.1 1994 Employee Stock Option Plan of Registrant
5.1 Opinion of Raymond P. Le Blanc
II-1
<PAGE>
15 Not Applicable
23.1 Consent of Raymond P. Le Blanc (included in
Exhibit 5.1)
23.2 Consent of Arthur Andersen LLP (included on Page II-6)
24.1 Power of Attorney of certain officers and directors (included on
Page II-4)
28 Not applicable
29 Not applicable
Item 9. Undertakings.
- ------ ------------
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the Prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the Registration Statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the Registration Statement or
any material change to such information in the Registration Statement;
Provided, however, that paragraphs (a)(1)(i) and (a) (1) (ii) do not
-------- -------
apply if the registration statement is on Form S-3 or Form S-8 and the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the Registrant
pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of
1934 that are incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of
the Registrant's annual report pursuant to Section 13(a) or Section 15(d) of
the Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in this
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
II-2
<PAGE>
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the Registrant pursuant to the foregoing provisions,
or otherwise, the Registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the Registrant of expenses incurred or paid by a director, officer
or controlling person of the Registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against
public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Goleta, State of California, on May 16, 1995.
APPLIED MAGNETICS CORPORATION
By /s/ Craig D. Crisman
-------------------------------------
Craig D. Crisman
President and Chief Executive Officer
POWER OF ATTORNEY
Each of the undersigned directors and officers of Applied Magnetics
Corporation constitutes and appoints Craig D. Crisman and Raymond P. Le Blanc,
and any or all of them, his true and lawful attorneys-in-fact and agents with
full power to do any and all things and to execute any and all instruments which
said attorneys-in-fact and agents may deem necessary or advisable to enable
Applied Magnetics Corporation to comply with the Securities Act of 1933, as
amended, and any rules, regulations and requirements of the Securities and
Exchange Commission in respect thereof in connection with the registration under
the Securities Act of 1933 of 1,000,000 Shares of Common Stock, $.10 par value,
of Applied Magnetics Corporation, to the same extent that he could do in person,
including specifically, but without limiting the generality of the foregoing,
the power and authority to sign the name of the undersigned directors and
officers in the capacities indicated below to any and all amendments (including
post-effective amendments) to this Registration Statement, and to file the same
with all exhibits to, and other documents in connection with, this Registration
Statement with the Securities and Exchange Commission.
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed below by the following persons in the capacities and
on the dates indicated.
II-4
<PAGE>
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<C> <S> <C>
President, Chief Executive Officer,
Chief Financial Officer
and Director
/s/ Craig D. Crisman (Principal Executive Officer
- -------------------------- and Principal Financial Officer) May 16, 1995
Craig D. Crisman
/s/ Peter T. Altavilla Corporate Controller
- -------------------------- (Principal Accounting Officer) May 16, 1995
Peter T. Altavilla
/s/ Harold R. Frank
- -------------------------- Director May 16, 1995
Harold R. Frank
/s/ R. C. Mercure, Jr.
- -------------------------- Director May 16, 1995
R. C. Mercure, Jr.
/s/ Herbert M. Dwight, Jr.
- -------------------------- Director May 16, 1995
Herbert M. Dwight, Jr.
</TABLE>
II-5
<PAGE>
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement of our reports dated December 22, 1994
included or incorporated by reference in Applied Magnetics Corporation's Annual
Report on Form 10-K for the fiscal year ended September 30, 1994 and to all
references to our firm included in this registration statement.
ARTHUR ANDERSEN LLP
Los Angeles, California
May 12, 1995
II-6
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Sequential
Numbering
Exhibits Page No.
- ------------ --------
<C> <S> <C>
4.1 1994 Employee Stock Option Plan of Registrant, as amended __
5.1 Opinion of Raymond P. Le Blanc, Esq. __
23.1 Consent of Raymond P. Le Blanc, Esq. __
(included in Exhibit 5.1)
23.2 Consent of Arthur Andersen LLP __
(included on Page II-6)
24.1 Power of Attorney of certain officers and directors __
(included on Page II-4)
</TABLE>
<PAGE>
EXHIBIT 4.1
APPLIED MAGNETICS CORPORATION
1994 EMPLOYEE STOCK OPTION PLAN
1. PURPOSE
The purpose of the Applied Magnetics Corporation 1994 Employee Stock Plan
(the "Plan") is to secure for Applied Magnetics Corporation (the "Company") and
its stockholders the benefits inherent in Common Stock ownership by selected key
employees who will be largely responsible for the Company's future growth and
success and to enable the Company to attract and retain such persons. It is
intended that this purpose will be effected through the granting of Options (as
defined herein) in accordance with the terms of the Plan.
2. DEFINITIONS
In addition to other capitalized terms which are defined in the Plan, the
following terms shall have the following definitions:
2.1 "Board" shall mean the Board of Directors of the Company.
2.2 "Change in Control" shall mean (a) an acquisition of the Company by
means of a merger or consolidation of the Company with or into another
corporation or a purchase of substantially all the Company's assets, following
which a majority of the board of directors of the successor or acquiring
corporation is not comprised of individuals who constituted a majority of the
Board immediately prior to the merger, consolidation or purchase of assets, or
(b) a change in the composition of a majority of the members of the Board
effected by the vote of a person who, following approval of the Plan by the
Company's stockholders, acquires or has acquired a number of voting securities
of the Company sufficient to elect a majority of the Board. As used in this
definition, the term "person" shall include two or more persons acting as a
partnership, limited partnership, syndicate or other group for the purpose of
acquiring, holding or disposing of the voting securities of the Company.
2.3 "Code" shall mean the Internal Revenue Code of 1986, as amended.
2.4 "Common Stock" shall mean the Company's $.10 par value Common Stock.
2.5 "Compensation Committee" or "Committee" shall mean the Compensation
Committee of the Board, provided that the Compensation Committee shall at all
times consist of two or more directors of the Company each of whom is not,
during the one year period prior to service on the Committee, granted or awarded
any equity securities, including options, warrants or other rights to acquire
equity securities, under the Plan or any other plan of the Company, other than
(a) a formula plan meeting the conditions of paragraph (c)(2)(ii) of Rule 16b-
3(2) of the Exchange Act, (b) an ongoing securities acquisition plan meeting the
conditions of paragraph (d) (2)(i) of Rule 16b-3(2) of the Exchange Act, or (c)
an election to receive an annual retainer fee in either cash or an equivalent
amount of securities or partly in cash and partly in securities.
2.6 "Company" shall mean Applied Magnetics Corporation, a Delaware
corporation.
2.7 "Date of Grant" shall mean the date on which the Committee grants an
Option under the Plan.
2.8 "Disability" shall mean the inability, as determined by the
Compensation Committee based on advice of a licensed physician, of an Optionee
to engage in any substantial gainful employment by reason of any medically
determinable physical or mental impairment which can reasonably be expected to
result in death or which has lasted or can be expected to last for a continuous
period of not less than 12 months.
1
<PAGE>
2.9 "Employee" shall mean an employee of the Company or any Subsidiary.
2.10 "Exchange Act" shall mean the Securities Exchange Act of 1934.
2.11 "Fair Market Value" shall mean the fair market value of a share of
Common Stock, determined as follows: (a) if Common Stock is traded on a stock
exchange or in the NASDAQ National Market System ("NASDAQ/NMS"), the fair market
value of a share on a particular date shall be the quoted selling price per
share of Common Stock on such exchange or NASDAQ/NMS on that date; (b) if Common
Stock is otherwise traded in the over-the-counter market, the fair market value
of a share of Common Stock on a particular date shall be the mean between the
closing bid and asked quotations per share of the Common Stock on that date; or
(c) if Common Stock is not traded on a stock exchange, NASDAQ/NMS or in the
over-the-counter market or, if traded, there are no transactions on that date,
the fair market value shall be determined in good faith by the Committee by
applying the rules and principles of valuation set forth in Section 20.2031-2 of
the Treasury Regulations (relating to the valuation of stocks and bonds for
purposes of Code Section 2031).
2.12 "Grant Amount" shall mean the number of shares subject to an Option
granted to an Optionee under the Plan.
2.13 "Incentive Stock Option" shall mean an Option which is intended to
qualify as an "incentive stock option" within the meaning of Code Section 422.
2.14 "Nonqualified Option" shall mean an option which is not intended to
qualify as an Incentive Stock Option.
2.15 "Option" shall mean an option to purchase shares of Common Stock
granted under the Plan, which may be either an Incentive Stock Option or a
Nonqualified Option.
2.16 "Option Price" shall mean the purchase price per share of Common Stock
as determined in accordance with the provisions of Section 6.2 hereof.
2.17 "Optionee" shall mean an Employee to whom an Option is granted under
the Plan.
2.18 "Reorganization" shall mean a sale or transfer of all or substantially
all the Company's assets, or a merger, reorganization, or consolidation of the
Company with another corporation in which the Company is not the surviving
corporation, or a liquidation or dissolution of the Company.
2.19 "Retirement" shall mean unless otherwise determined by the Committee,
an Optionee's voluntary termination of Employee status by delivery of formal
written notice thereof to the Company at any time after he or she has reached 60
years of age and shall have accrued at least 10 years of service as an Employee
(including its present or former Subsidiaries).
2.20 "Subsidiary" shall mean any corporation of which not less than 51
percent of the shares of its voting stock (representing the right, other than as
affected by events of default, to vote for the election of directors or other
managing authority) are now or hereafter during the term of this Plan, owned or
controlled directly or indirectly by the Company.
2.21 "Termination for Cause" shall mean any involuntary termination of an
Optionee's employment by the Company or any Subsidiary if (a) the termination is
a result of or in connection with such Optionee's (i) engaging in any business
that is competitive with that of the Company while an Employee, (ii) committing
any material act of dishonesty, including but not necessarily limited to theft
or embezzlement of funds or property of the Company, or perpetrating a fraud on
or affecting the Company, or (iii) engaging in any gross negligence or willful
misconduct with respect to his or her duties and responsibilities as an Employee
or acts in any other way that has a direct, substantial and adverse effect on
the Company's reputation, including but not necessarily limited to willful or
grossly negligent disregard for the Company's obligation to comply with laws,
regulations and the like applicable to the
2
<PAGE>
Company, its properties, assets or business, and (b) after the termination, the
Optionee is not an Employee.
3. AMOUNT OF SHARES SUBJECT TO THE PLAN
3.1 The shares reserved for issuance upon exercise of Options granted under
the Plan shall not exceed 1,000,000 shares of Common Stock, subject to
adjustment as provided in Section 7 hereof.
3.2 In the event that Options granted under the Plan shall terminate or
expire without being exercised in whole or in part, shares not purchased under
such lapsed Options will again become available under the Plan to be issued on
the exercise of new Options granted under the Plan subject to the limitations of
Section 3.1.
4. EFFECTIVE DATE
The Plan has been adopted by the Board on October 29, 1993 (the "Effective
Date"), subject to approval by affirmative votes constituting a majority of the
votes eligible to be cast by the Common Stock present in person or by proxy at a
meeting of the Company's stockholders.
5. ELIGIBILITY
Options may be granted to Employees whose performance the Committee
determines can have a significant effect on the success of the Company. Any
director who is not an Employee shall not be eligible to receive an Option under
the Plan. The adoption of this Plan shall not be deemed to give any Employee
any right to be awarded an Option. No Incentive Stock Option shall be granted
under this Plan to a person possessing more than 10 percent of the total
combined voting power of all classes of stock of the Company or of a Subsidiary.
6. TERMS AND CONDITIONS OF OPTIONS
Each Option shall be evidenced by a written agreement (herein "Stock Option
Agreement") in a form approved and authorized by the Committee, which shall be
executed by the Company and the Employee receiving the Option. All Options
shall be subject to the following terms and conditions and such additional terms
and conditions, not inconsistent with the Plan, as the Committee shall deem
necessary or appropriate:
6.1 The maximum number of shares of Common Stock with respect to which
Options may be granted to any Employee during the Term of the Plan is 1,000,000.
6.2 The purchase price per share of Common Stock purchasable under an
Option granted pursuant to the Plan shall be at least equal to the Fair Market
Value of one share of Common Stock on the Date of Grant, as determined by the
Committee in accordance with the terms hereof, which determination of Fair
Market Value, when made in good faith, shall be conclusive.
6.3 The period during which each Option may be exercised shall be fixed by
the Committee. Unless the Committee shall designate when an Option granted
pursuant to the Plan is exercisable, Options shall be exercisable as follows:
(a) at any time after the first anniversary following the Date of Grant, the
Option shall be exercisable as to 25 percent of the shares covered thereby; (b)
at any time after the expiration of two years following the Date of Grant, the
Option shall be exercisable, cumulatively, as to an additional 25 percent of the
shares covered thereby; (c) at any time after the expiration of three years
following the Date of Grant, the Option shall be exercisable, cumulatively, as
to an additional 25 percent of the shares covered thereby; and (d) at any time
after the expiration of four years following the Date of Grant, the Option shall
be exercisable as to all the shares covered thereby which have not theretofore
been exercised pursuant to the provisions of (a) through (c) above. The
Committee may, after an Option is granted and on such terms and conditions as it
considers appropriate, accelerate the times at which the Option may be
exercised.
3
<PAGE>
6.4 Options granted pursuant to the Plan shall expire and cease to be
exercisable upon the first to occur of any one of the following: (a) the
expiration of 10 years following the Date of Grant; (b) 90 days following the
date when an Optionee ceases to be an Employee, except in the case of a
Termination for Cause, Retirement, or a termination by reason of the Optionee's
death or Disability while an Employee; (c) if the Optionee dies while an
Employee or ceases to be an Employee by reason of the Optionee's Disability
while an Employee, one year following such death or termination of employment,
whichever occurs first; or (d) the Optionee's Termination for Cause.
Notwithstanding anything to the contrary contained herein, in no event
may an Option be exercised after the expiration of 10 years following the Date
of Grant.
6.5 The shares covered by an Option may be purchased and the Option may be
exercised in whole or in part at any time during the period defined in Section
6.3 above and prior to the expiration of such Option. Such exercise shall be in
the manner fixed by the Committee by giving written notice of exercise to the
Company specifying the number of shares to be purchased; provided, however, that
an Option may not be exercised with respect to less than 50 shares subject to an
Option unless there are less than 50 shares remaining subject to the Option.
6.6 The notice of exercise of Option, whether the exercise is to be in
whole or in part, shall be accompanied by delivery to the Company of (a) a
certified or cashier's check(s); (b) a check issued by a broker-dealer that is a
member firm of the New York Stock Exchange, Inc. for 100 percent of the Option
Price for the shares to be purchased; (c) at the discretion of, and upon such
terms and conditions as may be established by, the Committee, delivery of Common
Stock already owned by the Optionee for at least six months; or (d) any
combination of the foregoing. In the event that the Option Price is paid by a
check issued by a broker-dealer, an executed copy of the notice of exercise
shall be delivered to the broker-dealer, the notice of exercise shall instruct
the Company to deliver certificates for the shares to be purchased to the
broker-dealer and the Company shall confirm that it will deliver such
certificates to the broker-dealer. No shares shall be issued upon exercise of
any Option until full payment therefor has been made to and received by the
Company.
6.7 No Option granted under the Plan shall be transferable either
voluntarily or by operation of law except by will or by the laws of descent and
distribution and, during the lifetime of the Optionee, such Option shall be
exercisable only by him or her. If the Optionee dies while an Employee or
terminates his or her Employee status because of a Disability, without having
fully exercised his or her Option, all shares covered by such Optionee's Option
which were exercisable at the date of his or her death or termination of
Employee status because of a Disability and which become exercisable, in
accordance with the terms of such Option, within 12 months thereafter shall be
exercisable within such 12 month period when and as such shares becomes
exercisable by such Optionee (in the case of Disability) or, in the case of
death, by his or her estate or any other person who acquired the right to
exercise the Option by bequest or inheritance or by reason of death of the
Optionee and such estate or other person shall have the right to purchase by
exercise of said Option all or any portion of such shares; provided, however,
that no Option may be exercised at any time after the expiration date thereof.
If the Option is exercised by a person other than the Optionee, the Committee
may require appropriate proof of such other person's right to exercise said
Options.
6.8 If an Optionee ceases to be an Employee for any reason (other than
Termination for Cause, death or Disability while an Employee or Retirement) his
or her Option shall remain exercisable for a period of 90 days thereafter to the
extent, and only to the extent, such option was exercisable, by its terms, as of
the effective date of his or her cessation of Employee status. Upon Retirement
of an Optionee, all shares covered by such Optionee's Option shall continue to
be exercisable by such Optionee in accordance with the terms of such Option;
provided, however, that if, and to the extent that, an Incentive Stock Option is
exercised more than 90 days after the Retirement date, such Option will be
treated as a Nonqualified Option. No Option may be exercised at any time after
the expiration date thereof.
6.9 If an Optionee ceases to be an Employee and such termination was a
Termination for Cause, all Options shall immediately expire and cease to be
exercisable.
4
<PAGE>
6.10 No fractional shares will be issued pursuant to the exercise of any
Option nor will any cash payment be made in lieu of fractional shares.
6.11 In the event that, within 12 months following a Change in Control there
should occur, without an Optionee's consent, a material lessening of his or her
duties and responsibilities as an Employee or a material reduction in his or her
base salary from the rate in effect as of the Date of Grant and if, following
such material lessening of duties or responsibilities or a material reduction in
his or her base salary, the Optionee shall, by providing written notice to the
Company, voluntarily terminate his or her Employee status, unless the Board has
prior to such Change in Control, in its sole discretion, determined that all or
a portion of the outstanding Options held by such Optionee shall become
immediately and fully exercisable upon or immediately following such Change in
Control, all shares covered by such Optionee's Options shall become immediately
and fully exercisable and such Optionee shall have the right to purchase, by
exercise of such Option, all or any portion of the shares covered by such
Option; provided however, that in no event may any Option be exercised after the
expiration date thereof.
6.12 If (a) within 12 months following a Change in Control, an Optionee's
Employee status should be terminated involuntarily by the Company (or any
successor to the Company by reason of such Change in Control) and such
termination is not a Termination for Cause, and (b) the Board has not prior to
such Change in Control, in its sole discretion, determined that all or a portion
of the outstanding Options held by such Optionee shall become immediately and
fully exercisable upon or immediately following such Change in Control, then all
shares covered by such Optionee's Options shall become immediately and fully
exercisable and such Optionee shall have the right to purchase by exercise of
such Option, all or any portion of the shares covered by such Option; provided,
however, that in no event may an Option be exercised after the expiration date
thereof.
7. ADJUSTMENT IN THE EVENT OF CHANGE IN STOCK
7.1 Notwithstanding any other provision of the Plan, Stock Option
Agreements made hereunder shall contain such provisions as the Committee shall
determine to be appropriate for the adjustment of the number of shares subject
to each outstanding Option and the Option Price per share, in the event of
changes in the outstanding Common Stock of the Company by reason of stock
dividends, recapitalization, split-ups, combinations, mergers (including
reincorporation effected by means of a merger), reclassification or exchanges of
shares and the like in order to preserve the Optionee's proportionate interest
in the aggregate number of shares under the Option held by him or her and to
continue the aggregate purchase price of all shares as nearly the same as
possible.
7.2 In the event of any change in the outstanding Common Stock by reason of
stock dividends, recapitalization, combinations, mergers (including
reincorporation affected by means of a merger) reclassification, or exchanges of
shares and the like, the aggregate number of shares reserved for Options which
may be awarded under the Plan shall be appropriately adjusted to the nearest
whole share by the Board, whose determination shall be conclusive.
8. GOVERNMENT REGULATIONS
The Plan, the grant and exercise of Options granted thereunder, and the
Company's obligation to sell and deliver shares of Common Stock under such
Options, shall be subject to all applicable federal and state laws, rules and
regulations, and to such approvals by any regulatory or governmental agency as
may be required, including, but not necessarily limited to, the obtaining of a
permit from the commissioner of Corporations of California, if required, and
registration of the securities subject to this Plan with the Securities and
Exchange Commission. In addition, the Company may cause an appropriate legend
to be affixed to any stock certificate representing Common Stock issued under
the Plan in accordance with all applicable federal and state securities laws,
rules and regulations.
5
<PAGE>
9. ADMINISTRATION AND OPERATION
9.1 The Plan shall be administered by the Committee which shall, from time
to time and in its absolute discretion, determine which Employees shall become
Optionees, the number of shares of Common Stock to be subject to each Option,
and the price, terms and conditions, consistent with this Plan, of each Option.
Options may be Incentive Stock Options or Nonqualified Options, as determined by
the Committee in its sole discretion; provided, however, that no Options may be
granted more than 10 years after the Effective Date.
9.2 The following amounts shall not exceed $100,000: the aggregate fair
market value (determined on the Date of Grant) of stock of the Company and any
Subsidiary for which an Employee is granted incentive stock options (within the
meaning of Code Section 422(b)) under all plans of the Company and any
Subsidiary and which incentive stock options are exercisable for the first time
by such Employee during any calendar year.
9.3 Whenever, under the Code and applicable regulations, the issuance of
shares of Common Stock upon the exercise of Options will result in any
requirement that the Optionee pay or otherwise satisfy any federal, state or
local payroll withholding amounts, including taxes, FICA and the like, it shall
be a condition to the issuance of such Common Stock that the Optionees shall
have made arrangements satisfactory to the Company, as determined in accordance
with rules established by the Committee, with respect to the payment or
satisfaction of such withholding amounts. In lieu of paying in cash additional
sums which may be required to satisfy such withholding amounts, if any, the
Committee may permit Optionees to elect to deliver to the Company shares of
Common Stock held by such Optionee or a portion of the shares of Common Stock
subject to the Option then being exercised by such Optionee as payment or in
partial payment of the withholding amount requirement subject, however, to such
rules as may be adopted by the Committee.
9.4 The Board may at any time and from time to time modify, amend, suspend
or discontinue the Plan in any respect, except that, without stockholder
approval, the Board may not increase the number of shares reserved under the
Plan (other than increases due to changes in capitalization), permit the
issuance of Common Stock upon exercise of an Option before payment therefore in
full, make any change in the eligibility requirements hereunder, or extend the
period within which Incentive Stock Options may be granted. Approval by the
stockholders means approval of the affirmative votes of the holders of a
majority of the shares of Common Stock present or represented and voting at a
meeting duly held in accordance with the applicable laws of the state of
Delaware. The modification or amendment of the Plan shall not, without the
consent of an Optionee, adversely affect his or her rights under Options
previously issued to him or her.
9.5 Neither the Plan nor any Option shall confer upon any Optionee any
right to continued employment by the Company or any Subsidiary, or shall
interfere in any way, except as provided in Sections 6.11 and 6.12, with the
right of the Company or any Subsidiary to terminate his or her employment at any
time.
9.6 The Company shall not be required to issue or deliver any certificates
for shares of Common Stock under the Plan prior to: (a) the listing of such
shares on any stock exchange on which the Common Stock may then be listed; and
(b) the completion of any registration or qualification of such shares under any
federal or state securities laws, or any rulings or regulation of any
governmental body, which the Committee shall, in its sole discretion, determine
to be necessary or advisable.
9.7 The Committee may amend the Plan from time to time in order to limit
the Options that may be granted to any person or group of persons. Such
limitations, if any, may be expressed, at the discretion of the Committee,
either as an absolute limit or as a percentage of available shares.
10. REORGANIZATION
10.1 Nothing contained in the Plan or in any Option granted under the Plan
shall in any way prohibit the Company from effecting or entering into a
Reorganization.
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10.2 In the event of any Reorganization, all rights of the person or persons
entitled to exercise then outstanding Options granted under the Plan and such
Options shall wholly and completely terminate at the time of any such
Reorganization, except to the extent that any agreement or undertaking of any
party to any such Reorganization shall make specific provision with respect to
such Options and the rights of such Optionees. Notwithstanding the foregoing,
the Board may determine that each Optionee shall have the right immediately
prior to such Reorganization to exercise such Optionee's Option with respect to
any or all of the shares remaining subject to such Option, whether or not such
shares are then otherwise purchasable by said Optionee. To the extent that any
such exercise relates to shares which are not otherwise purchasable by the
Optionee at such time, such exercise shall be contingent upon the consummation
of such Reorganization.
11. GENERAL PROVISIONS
11.1 No Optionee and no beneficiary or other person claiming under or
through such Optionee shall have any rights as a stockholder of the Company with
respect to any shares of Common Stock allocated or reserved under the Plan and
subject to any Option except as to such shares of Common Stock, if any, that
have been issued or transferred to such Optionee.
11.2 The Plan and all determinations made and actions taken pursuant thereto
shall be governed by the laws of the State of California and construed in
accordance therewith.
11.3 The Plan will become effective upon approval by the stockholders at a
meeting of stockholders of the Company during 1994. Unless previously
terminated, the Plan will terminate 10 years after the Effective Date (the
"Term").
This Applied Magnetics Corporation 1994 Employee Stock Option Plan has been
adopted by the Board on October 29, 1993, and approved by the stockholders on
February 18, 1994.
APPLIED MAGNETICS CORPORATION
By:__________________________ By:_________________________
William R. Anderson Raymond P. Le Blanc
Chief Executive Officer Vice President, Secretary
General Counsel
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EXHIBIT 5.1
May 16, 1995
Applied Magnetics Corporation
75 Robin Hill Road
Goleta, CA 93117
Re: Applied Magnetics Corporation 1994 Employee Stock Option Plan
Gentlemen:
As General Counsel of Applied Magnetics Corporation (the "Company"), I have
examined the Registration Statement on Form S-8 ( the "Registration Statement")
to be filed by the Company with the Securities and Exchange Commission in
connection with the registration under the Securities Act of 1933, as amended,
of 1,000,000 shares of $.10 par value Common Stock of the Company ("Common
Stock") issuable on the exercise of options granted or to be granted under the
Company's 1994 Employee Stock Option Plan (the "1994 Plan") and such additional
shares as may become subject to issuance on the exercise of options as a result
of adjustment provisions in the 1994 Plan.
I have examined the originals, certified copies or copies otherwise identified
to my satisfaction, of such documents as I have deemed necessary or appropriate
for the purposes of this opinion. I have also examined the proceedings
heretofore taken, and I am familiar with additional proceedings proposed to be
taken, in connection with the authorization, issuance and sale of the Common
Stock upon exercise of options granted and to be granted under the 1994 Plan.
Based upon such examinations, I am of the opinion that the shares of Common
Stock issuable upon exercise of options granted and to be granted pursuant to
the 1994 Plan will, if issued in accordance with the terms and provisions of the
1994 Plan and if issued upon receipt by the Company of proper consideration from
the option holders, be legally and validly issued, fully paid, and
nonassessable.
I consent to the use of this opinion as an exhibit to said Registration
Statement and to the use of my name under the heading "Legal Matters" in the
Prospectus constituting part of the Registration Statement.
Yours very truly,
Raymond P. Le Blanc
Vice President, Secretary & General Counsel
